STRONGER SHARPER SMARTER Hathway Cable and Datacom Limited 60th Annual Report 2019-20 WHAT LiES ahead… 01 Corporate Information 02 Stronger. Sharper. Smarter. 04 Strategic Communiqué from the MD 06 Transforming to Grow 12 Leveraging Strengths to Grow Stronger 16 Powering Efficiencies to Become Sharper 20 Expanding Outreach, the Smarter Way 24 Stronger Efficiencies. Sharper Focus. Smarter Growth. 28 More Ahead 29 Mapping the GTPL Hathway Performance 30 Notice 41 Directors’ Report 56 Management Discussion & Analysis 64 Report on Corporate Governance Standalone Financial Statements To download or to read this 88 report online, please log on to Consolidated Financial Statements www.hathway.com 154 CORPORATE INFORMATiON BOARD OF DIRECTORS CHIEF FINANCIAL OFFICER COST AUDITORS Mr. Sridhar Gorthi Mr. Sitendu Nagchaudhuri Ashok Agarwal & Co., DIN: 00035824 Cost Accountants Chairman and Independent Director HEAD CORPORATE LEGAL, COMPANY SECRETARY AND INTERNAL AUDITORS Mr. Sasha Mirchandani CHIEF COMPLIANCE OFFICER Group Internal Audit Cell, DIN: 01179921 Mr. Ajay Singh Co-sourced with Chartered Independent Director FCS No.: 5189 Accountancy Firms Ms. Ameeta Parpia REGISTERED OFFICE ADVOCATES AND SOLICITORS DIN: 02654277 “Rahejas”, 4th Floor, Corner of Main Trilegal (Mumbai) Independent Director Avenue & V. P. Road, Santacruz (W), S. Mahomedbhai & Co. (Mumbai) Mumbai - 400 054. M/s. Dua Associates (Mumbai) Mr. Akshay Raheja Tel No.: (022) 26001306; DIN: 00288397 Fax No.: (022) 26001307 BANKERS Non-Executive Director CIN: L64204MH1959PLC011421 Axis Bank Limited HDFC Bank Limited Mr. Viren Raheja CORPORATE OFFICE ICICI Bank Limited DIN: 00037592 805/806, Windsor, 8th Floor, IDFC FIRST Bank Limited Non-Executive Director Off CST Road, Kalina, Santacruz East, IndusInd Bank Limited Mumbai - 400 098. Kotak Mahindra Bank Limited Mr. Saurabh Sancheti Tel No.: (022) 67742500; RBL Bank Limited DIN: 08349457 Fax No.: (022) 67742400 Yes Bank Limited Non-Executive Director Website: www.hathway.com Email: [email protected] REGISTRAR AND TRANSFER AGENT Mr. Anuj Jain Link Intime India Private Limited DIN: 08351295 STATUTORY AUDITORS C-101, 247 Park, LBS Marg, Non-Executive Director Nayan Parikh & Co., Vikhroli West, Mumbai-400083 Chartered Accountants Tel: (022) 49186000; Ms. Geeta Fulwadaya Fax: (022) 49186060 DIN: 03341926 SECRETARIAL AUDITORS Website: www.linkintime.co.in Non-Executive Director Rathi and Associates, Company Secretaries Mr. Rajan Gupta DIN: 07603128 Managing Director CORPORATE OVERVIEW NOTICE DIRECTORS’ REPORT MANAGEMENT DISCUSSION AND ANALYSIS THE WORLD iS CHANGiNG, AND SO ARE ENTERPRiSES. Constantly embracing new ideas, continuously adopting breakthrough technologies and consistently adapting to the fast-paced transformations, businesses today are getting bigger, better and more efficient. Employing the core of their capabilities and capacities, they are powering unprecedented changes across functions to connect more deeply with their customers. REPORT ON STANDALONE CONSOLIDATED CORPORATE GOVERNANCE FINANCIAL STATEMENTS FINANCIAL STATEMENTS At Hathway, too, we are in the midst of change. Transforming across the organisational fabric, we are progressively strengthening our business proposition to enhance our customer interface. Through a slew of initiatives, we focussed further on augmenting our operational and cost efficiencies during FY 2019-20, as we accelerated the shift towards a more sharply defined Business-to-Consumer (B2C) strategic approach. Leading this change were our energised efforts to harness the new opportunity landscape unleashed by the New Tariff Order (NTO) regulatory regime, as we moved proactively to address the evolving needs and aspirations of customers more efficaciously. Further being part of the Reliance Group now, has also ushered in greater competencies and capabilities to propel the Company’s quest to become a Stronger, Sharper and Smarter entity. CORPORATE OVERVIEW NOTICE DIRECTORS’ REPORT MANAGEMENT DISCUSSION AND ANALYSIS STRATEGiC COMMUNiQUÉ FROM THE MD Dear Valued Shareholders, The transformational wave, unleashed in the Indian media and telecommunication industry in the previous fiscal by the NTO regulatory changes, growing competitiveness, market consolidation and new techno-digital interventions, witnessed Aligning ourselves with speed and agility to these a further strengthening fast-paced changes, and seizing the momentum that we had built in FY 2018-19, we, at Hathway, focussed during during FY 2019-20 amid FY 2019-20 on reinforcing our service charter to drive greater efficiencies. The overarching goal of our efforts was a challenging business to achieve bigger and smarter growth in a more transparent landscape. The NTO- environment, with customer-centricity driving our strategic driven paradigm shift in TV plans in the new order of things. consumption culture saw a Moving aggressively to implement the NTO through strategic reorientation of our business model, we put into motion a new level of broad-basing, series of initiatives during the year in review. These were even as online content aimed at further streamlining our systems and processes, and boosting their efficacy in the new regime. Cumulatively, consumption continued these measures will help increase satisfaction for both, our to grow phenomenally to Local Cable Operators (LCO) partners and end customers, eventually translating into sustained increase in revenue, boost demand for high profitability and market share. speed connectivity through We also delivered a strong set of operating and financial fixed Broadband. results for FY 2019-20. 4 Hathway Cable and Datacom Limited Annual Report 2019-20 REPORT ON STANDALONE CONSOLIDATED CORPORATE GOVERNANCE FINANCIAL STATEMENTS FINANCIAL STATEMENTS We are proud of our team that has been prudent in financial management and undertook the necessary actions in these As we gear up to sharpen the unprecedented times towards increasing revenue, controlling contours of our transformed costs, optimising Working Capital and Capex, and improving strategic framework, our endeavour overall financial performance. will be to utilise the levers of technology and digitalisation even Our efforts to enhance our operational efficiencies got a more vigorously to further enrich further infusion of energy after the Board of Directors of the customer experience. Company, at its meeting held on February 17, 2020, approved the Composite Scheme of Amalgamation and Arrangement, paving the way for the amalgamation of the Company, along with Den Networks Limited and TV18 Broadcast Limited, into Network18 Media & Investments Limited. We see in this integration the roadmap for further improvement in our business capability and performance, leading to greater profitability through a more cutting-edge B2C proposition. As we gear up to sharpen the contours of our transformed Though times are tough and strategic framework, our endeavour will be to utilise the unpredictable currently, levers of technology and digitalisation even more vigorously I am confident of our ability to to further enrich customer experience. We shall strive to deliver growth and increase in bring in more and better innovations to enhance customer shareholder value in the coming engagement and empowerment, even as we consolidate the year, as has been demonstrated in best practices and learnings we embraced during FY 2019-20 FY 2019-20. in the post-NTO era. It will help us to clearly define the way forward for further improvement in our business profile and performance, leading to greater profitability through a sharper customer- focussed strategy, notwithstanding the short-term disruptions to economy as a result of the COVID pandemic. Though times are tough and unpredictable currently, I am confident of our ability to deliver growth and increase in shareholder value in the coming year, as has been demonstrated in FY 2019-20. On this note, I would like to conclude by thanking all of you, on behalf of Hathway, for your unwavering support and trust. Thank You, Rajan Gupta Managing Director Hathway Cable and Datacom Limited Annual Report 2019-20 5 CORPORATE OVERVIEW NOTICE DIRECTORS’ REPORT MANAGEMENT DISCUSSION AND ANALYSIS TRANSFORMING TO GROW THE EVOLUTiON OF HATHWAY One of India’s leading Cable TV and Wired Broadband service providers, Hathway Cable and Datacom Limited (“Hathway” or the “Company”) is a continually evolving organisation that is leading the country’s Cable and Broadband industry transformation. The Company’s transformational agenda is steered by its deep-rooted expertise and experience that enable it to adapt to changes with speed and agility, across segments and functions. Focussed on engineering change with our industry-leading initiatives and technological prowess, we have, over the years, developed an intrinsic understanding of customer and market needs. At the same time, we are engaged in transforming our own eco-system to make the necessary shift from our conventional Business-to-Business (B2B) approach to the more dynamic B2C model, to effectively address the changing demands of customers in the new business environment. 6 Hathway Cable and Datacom Limited Annual Report 2019-20 REPORT ON STANDALONE CONSOLIDATED CORPORATE GOVERNANCE FINANCIAL STATEMENTS FINANCIAL STATEMENTS Vision To be a single point access provider, bringing into the home and workplace a converged world of information, entertainment and services. Hathway Cable and Datacom Limited Broadband Cable TV Strategic Business Business* Investment Parent Hathway Digital